It’s Time for Congress to Modernize the Television Marketplace

On Tuesday, the Communications and Technology Subcommittee of the House Committee on Energy and Commerce will hold a hearing to examine the state of the media marketplace. On Wednesday, the Senate Committee on Commerce, Science, and Transportation will hold a similar hearing. The increased attention on this important topic should be welcome news for taxpayers and consumers. New innovative technologies are rapidly changing the way Americans watch television programs and movies. The free market will continue to deliver better and cheaper options to viewers -- unless it is hindered by outdated laws and regulations.

One such law, the Satellite Television Extension and Localism Act, will garner considerable attention during the hearings -- largely because it is scheduled to expire at the end of this calendar year. Now that the primary provision in “STELAR” lacks substantial policy justification, Congress should not reauthorize the legislation.

The original law was passed when the television marketplace looked very different than it does today. Decades ago, Congress afforded satellite providers the ability to carry distant, out-of-market network signals to guarantee that their customers had access to programming from the major networks. This was a relevant concern when satellite providers couldn’t technologically provide local network access and some viewers in more remote, rural areas were not serviced by over-the-air broadcasts. Thanks to technological advancements, there is less standing in the way between viewers and local networks. STELAR’s pending expiration provides an ideal opportunity for the government to step back and consider how best to allow private companies to compete against one another on a level, modern playing field.

Of course, creating a truly level playing field with minimal government interference requires much more than simply allowing STELAR to expire. This should be the start -- not the end -- of a comprehensive approach to modernizing the marketplace via deregulation. That’s why NTU has long supported legislation like Rep. Steve Scalise’s (R-LA) Next Generation Television Marketplace Act, which was originally introduced in 2012.

As we wrote then, Scalise’s bill “would begin to untangle the complex web of regulations and preferences that exist in television service by repealing provisions that distort the marketplace and harm consumers.” It does so via a number of major changes:

“First, the legislation repeals carriage-mandates of certain broadcast signals by cable and satellite operators. The bills also eliminate retransmission consent and compulsory license provisions, thereby placing negotiations between television content and service providers on a more level and clearly delineated playing field.”

Small steps toward regulatory modernization, like allowing STELAR to expire, are important. But Congress should also engage in a more comprehensive review and reform initiative that brings our laws and regulations up to date and allows the private sector to innovate on behalf of consumers. Such an initiative should have a wide scope, extending into the realm of taxes. For example, passage of the Digital Goods and Services Tax Fairness Act would clarify the rules of the road for state taxation of items such as video downloads.

This week’s hearings can help continue an important policy debate about the video market going forward. Every current -- and future -- participant in this market can benefit, if Congress maintains a broad perspective that fosters innovation and competition.